BMW leaps on China export opportunity

BMW leaps on China export opportunity

Planning to ship cars made at Rayong unit

Mr Wiedmann says BMW has great flexibility within its global network.
Mr Wiedmann says BMW has great flexibility within its global network.

BMW Group Thailand plans to export more locally assembled cars to China this year to expand the footprint of the Rayong plant.

President Christian Wiedmann said the local arm of the German car maker plans new shipment activity of BMW cars to China, as the country has a free-trade agreement (FTA) with Thailand on imports and exports.

He declined to reveal further details, saying only that the group is planning on the new exports some time in 2019.

Meanwhile, the Munich-based parent firm can allocate production capacity with great flexibility from 30 production and assembly facilities in 14 countries, Mr Wiedmann said.

"For example, the plants in the US are tightening to produce and assemble cars for export, and BMW can ramp up capacity in other countries to support its global strategy," he said. "The local plant in Rayong will become very important in supporting shipments to China."

The group's local arm has three entities: BMW Thailand Co, BMW Group Manufacturing Thailand Co and BMW Leasing Thailand Co.

BMW Group Manufacturing Thailand is responsible for making seven car models for BMW and seven motorcycle models for BMW Motorrad. The plant is at Amata City Rayong Industrial Estate and has annual production capacity of 20,000 cars and 10,000 motorcycles.

The group began shipping two BMW cars, the X3 and the X5, to China in May 2016. Only the X5 is exported to that country now.

BMW reported that the Rayong plant made 15,302 cars in 2018, with shipments to China accounting for 28%. The Thai market made up the remainder.

BMW Motorrad produced 3,077 motorcycles in 2018, with 53% of the output shipped to China, Malaysia, the Philippines and Vietnam and the remaining 47% sold in Thailand.

Mr Wiedmann said the parent firm has no limits for the Rayong plant in serving export markets by geographic location, including expanding car shipments to Southeast Asia.

"The FTA in Asean is overwhelming for further shipment activities," he said.

In related news, the group reached an all-time high with 12,036 BMW deliveries in 2018, up 20% -- the highest growth rate across BMW's global network for the second straight year.

Sales of BMW plug-in hybrid vehicles achieved a record-high growth rate of 122% in Thailand in 2018, representing 25% of total sales for the period.

Mini cars also achieved a sales record with 1,051 deliveries in 2018, up 4%, while BMW Motorrad sold 2,154 motorcycles, up 8%.

Mr Wiedmann said the sales growth of the three brands in 2018 was in line with the overall premium car segment's 31,000 units sold, up 13%.

For 2019, the group forecasts 32,000 cars sold in the premium segment.

BMW expects growth to outperform in 2019 after achieving a strong sales performance in the past two years, Mr Wiedmann said.

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